A disadvantage of pursuing a cost leadership strategy is that
A) technological change can make experience curve economies obsolete.
B) price wars make it hard to compete with differentiators.
C) it costs more than a differentiation strategy because of the necessity of high capital investments.
D) powerful buyers are a major threat.
E) no quality control exists.

Question

Quizplus · Accepted Answer

Pursuing a cost leadership strategy relies heavily on achieving experience curve economies through efficient production methods and cost minimization. However, technological change can quickly make these economies obsolete, making it difficult to maintain a sustainable competitive advantage solely based on low cost.

A Disadvantage of Pursuing a Cost Leadership Strategy Is That